- If both the failure-to-file penalty and the failure-to-pay penalty apply in any month, the 5 percent (or 15 percent) failure-to-file penalty is reduced by the failure-to-pay penalty. However, if you file your return more than 60 days after the due date or extended due date, the minimum penalty is the smaller of $210 or 100 percent of the unpaid tax.
- These are some of the civil penalties the IRS can assess if a taxpayer fails to file a tax return and pay taxes. Other penalties may apply, as well as interest.
The calculation of penalties can be a difficult task. The services of a CPA can be invaluable in such cases. And, be sure all clergy staff members understand the quarterly estimated tax procedure.
In addition to the civil penalties listed above, a taxpayer can be subject to criminal penalties for a willful attempt to evade taxes. Criminal liability requires an affirmative act (typically filing a false return). Omissions are generally insufficient. Tax evasion is a felony punishable by a fine of not more than $100,000 or a prison sentence of up to five years or both. But civil penalties are much more likely, as few ministers are convicted and imprisoned for tax crimes.